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Be wary of schemes or products that claim a guaranteed income or rely on you recruiting new people in order to generate money.

Don't let anyone pressure you into making decisions about investing your money into a scheme. A lot of people involved in the scheme are trying to ensure that they are making their money back by recruiting new members.

Family members and friends may try to involve you in a pyramid scheme without realising that it is one.

Always seek financial advice if you are unsure.

It is against the law not only to promote a pyramid scheme and recruit other members as well as participating in one.

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If you think you have been scammed in the latest 'pyramid scheme' described in the introduction, you can report it to Devon and Cornwall Police, on 101, quoting log 137 of April 26, 2018.

If you've provided your account details to a scammer, you should contact your bank immediately.

Four ways to spot a pyramid scheme scam

Upfront costs - There is likely to be a large upfront payment in a pyramid scheme and then you will told that you should make the initial payment back as well as hundreds or thousands of pounds more.

Recruiting members - You're offered to join a scheme or group where you will be expected to recruit new participants in order to make any money from the scheme.

What the promoter says - The person promoting the scheme, or trying to recruit you makes claims such as 'this isn't a pyramid scheme' or says that it is legal.

Goods or services - The scheme involves offering goods or services of little or no value and only serve to promote the scheme. For example some pyramid schemes could 'sell' on information sheets, or could claim that if you put money in, you will make it back along with extra - if you recruit new members.

Advice from Police Action Fraud

Pyramid scheme fraud involves an unsustainable business which rewards people for enrolling others into a business that offers a non-existent or worthless product.

A fraudster advertises a multi-level investment scheme that offers extraordinary profits for little or no risk.

You’re required to pay a fee to enter the investment scheme.

You are then required to recruit friends or family members to enter the scheme. If you do this successfully, you’re paid out of their receipts. They are then told to recruit others to keep the chain going.

Your money is not actually invested in any product. Instead, it’s simply passed up the chain of investors. Because pyramid schemes are unauthorised and make no profits, you’re very unlikely to recover any lost investment. While the fraudster at the top will collect most of the profits, those who entered the scheme later end up losing out.

Legitimate trading schemes rely on valuable goods and services, while illegal pyramid schemes focus simply on recruiting more and more investors.

Using hard-sell techniques, fraudsters try to pressure you into making rushed decisions, giving you no time to consider the nature of the investment.

Fraudsters aim to make their business seem legitimate. This means they will often use technical jargon, impressive job titles and mock websites to look credible. If you have any suspicions about a scheme’s authenticity, you should investigate the company’s status and contact details.

Keep any written communications you’ve received from the pyramid scheme. They may help you give evidence to the authorities.

Be aware that you’re now likely to be a target for other frauds. Fraudsters often share details about people they’ve successfully targeted or approached, using different identities to commit further frauds

People who’ve already fallen victim to fraudsters are particularly vulnerable to the fraud recovery fraud. This is when fraudsters contact people who have already lost money through fraud and claim to be law enforcement officers or lawyers. They advise the victim that they can help them recover their lost money – but request a fee.

Protect yourself against pyramid scheme fraud

If you’re considering any type of investment, always remember: if it seems too good to be true, it probably is. High returns can only be achieved with high risk.

Pyramid schemes often involve products that are overpriced and have no real resale value. You should think about the true value of your investment before convincing friends and family to join the scheme.